State lawmakers seek to require banks to do business with gun industry

By Bryn StoleThe Advocate (Baton Rouge)

Tuesday

Apr 23, 2019 at 6:41 PMApr 23, 2019 at 6:41 PM

BATON ROUGE -- A year-old political battle over firearms policies adopted by handful of national banks and financial institutions is still burning in the Louisiana State Capitol.

House Bill 413 Rep. Blake Miguez, a New Iberia Republican and competitive shooter, would outlaw what he called "discrimination" by making it illegal for a bank, credit card processor or other financial institution to turn down customers because of their involvement in the firearms industry.

Under Miguez's proposal, no bank could reject a potential customer "solely" because that business made or sold guns legally under Louisiana law. Complaints would be directed to the Attorney General's Office, which could investigate and pursue civil penalties against any offending banks.

The House Commerce Committee forwarded the bill to the full House today without objection.

Miguez and lobbyists for the firearms industry framed the measure as a defense of Louisianans' Second Amendment right to own firearms against "political" or "social" policies imposed by out-of-state corporations.

"Without financing, these businesses could go out of business overnight," Miguez said of gun dealers, shooting ranges and others in the industry. "This (bill) is sort of protecting those businesses from the financial institutions" if they decide to "solely discriminate" against businesses legally dealing guns or ammunition in Louisiana.

But several lawmakers questioned Miguez about whether his bill would trample on the rights of bank leaders and business owners to decide how to run their institutions.

Miguez's bill is aimed squarely at a number of major national banks -- Bank of America and Citigroup Inc. among them -- that imposed rules on gun-dealing clients or pared back business with manufacturers in the wake of deadly mass-shootings.

Citigroup, for instance, announced last year it wouldn't do business with retailers that sell high-capacity magazines, guns without a background check or, with a handful of exemptions, to anyone under the age of 21. Bank of America decided to stop lending money to manufacturers of military-style firearms -- such as AR-15 rifles -- for the civilian market.

Those moves came in the weeks after a shooter killed 17 people at Marjory Stoneman Douglas High School in Parkland, Florida.

The banks' moves prompted an intense political backlash from gun-friendly lawmakers. Miguez and a handful of other conservative Louisiana Republicans led a successful effort at the State Bond Commission in August to block Citigroup and Bank of America from participating in a $600 million state highway project because of the firearms policies.

Miguez's bill would now go further by attempting to outlaw those policies under state law.

Several people in the firearms industry in Louisiana testified Tuesday that restrictions at big banks, credit card companies and payment processors have posed challenges for their businesses and cut into narrow profit margins.

"It was quite difficult for us at first to find somebody who'd take us on as a client for payment processing," said Joshua Barnhill with Acadian Armament, a small gunmaker in Lafayette. "Eventually we did find somebody -- but the rates weren't as good as other banks."

But critics of the proposal said it'd trample on private companies' prerogative to set their own policies and decide what other companies to do business with.

The bill would "upend discrimination law" by giving blanket protections to the firearms industry, something "no other industry enjoys," said Kaitlyn Johnson, a volunteer from Baton Rouge with the gun control group Moms Demand Action.

"This bill would essentially use government authority to force private institutions to do business with another industry," said Johnson. "Government should not be telling private institutions how to run their business."

Rep. Cedric Glover, D-Shreveport, pointedly asked Miguez if his law didn't deny the right of "conscientious business owners" at financial institutions to run their business how they choose. A bank might not want to support the pornography industry, Glover noted, despite U.S. Supreme Court decisions finding pornography is protected by the First Amendment.

Glover also noted Miguez's bill would still allow gun shops to impose tighter restrictions on firearms sales than Louisiana state law requires, such setting higher minimum age requirements.

"The gun dealer gets to make that decision regarding the 18-year-old but the financial institution does not?" Glover asked Miguez.

Miguez contended the fact that most of the financial industry is "highly regulated" by state and federal regulators -- and the fact that losing access to banking services can strangle a business -- should allow for greater government interference to protect the gun industry's "Second Amendment rights" from "discrimination."

"Not just any business owner -- it's in particular the financial institutions, which are highly regulated," said Miguez.

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